Demystifying supply chain finance

Faced with increasing pressure to meet short term liquidity needs, companies are looking inward for ways to release trapped cash from operations. Today's CFOs and treasurers are taking a fresh look at how their physical supply chain is impacting their companies' cash flow and working capital management.

Concerned about the rising risks in their supply chains stemming from the economic stress on suppliers, volatile energy and commodity prices, and broad based financial turmoil, today's executives are actively looking at supply chain finance options in terms of lowering their overall financial supply chain costs.

PwC explores a type of SCF in which a third party financier provides liquidity to suppliers by leveraging their buyers' higher credit rating — an arrangement that often involves the use of a technology platform to automate transactions and provide visibility into the invoice approval status to all parties involved.